# Net and gross revenue retention

> Northwind Care's first cohort a year on: NRR and GRR from one MRR bridge, and why they travel together.

Source: https://lopifi.com/learn/saas-metrics-and-unit-economics/nrr-and-grr
Part of: Lopifi — US GAAP books on autopilot, checked by a CPA (https://lopifi.com)

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**How do I calculate net revenue retention and gross revenue retention?** Northwind Care's first cohort a year on: NRR and GRR from one MRR bridge, and why they travel together.

Retention is measured on a cohort: the customers on the plan at the start of the period, and only them. New customers are left out of both sides. Start from their [MRR](https://lopifi.com/md/glossary/mrr) then, add what they upgraded, take off what they downgraded and what cancelled, and divide by where they started. With expansion, that's [net revenue retention](https://lopifi.com/md/glossary/net-revenue-retention). Without it, [gross revenue retention](https://lopifi.com/md/glossary/gross-revenue-retention), which can never pass 100%.

|  | MRR |
| --- | --- |
| Starting MRR, the cohort | 6,000 |
| Plus: [expansion](https://lopifi.com/md/glossary/expansion-mrr) | 900 |
| Less: [contraction](https://lopifi.com/md/glossary/contraction-mrr) | (300) |
| Less: [churn](https://lopifi.com/md/glossary/churned-mrr) | (600) |
| Same customers today | 6,000 |
| Net revenue retention | 100.0% |
| Gross revenue retention | 85.0% |

Northwind Care's first cohort, a year on. Plan assumptions.

**Wrong:** "Retention is 100.0%."
(Which retention? Which cohort?)

**Right:** NRR 100.0% · GRR 85.0%
Cohort: customers on the plan at the start of the year

NRR alone lets expansion hide churn. Two plans with the same NRR can lose very different shares of their base. GRR is the share kept with no help from upgrades.

## Where this page's rules come from

- [Wikipedia, “Churn rate”](https://en.wikipedia.org/wiki/Churn_rate) — Churn rate — background (reference)

## Read further

- https://lopifi.com/md/calculators/net-new-mrr
- https://lopifi.com/md/calculators/logo-churn
- https://lopifi.com/md/accounting/net-revenue-retention
- https://lopifi.com/md/accounting/gross-revenue-retention

- **Track:** [Finance](https://lopifi.com/md/learn/finance)
- **Part of:** [SaaS metrics and unit economics](https://lopifi.com/md/learn/saas-metrics-and-unit-economics) — 5 min
- **Terms taught:** [Net revenue retention](https://lopifi.com/md/glossary/net-revenue-retention), [Gross revenue retention](https://lopifi.com/md/glossary/gross-revenue-retention), [Expansion MRR](https://lopifi.com/md/glossary/expansion-mrr), [Contraction MRR](https://lopifi.com/md/glossary/contraction-mrr), [Churned MRR](https://lopifi.com/md/glossary/churned-mrr), [MRR](https://lopifi.com/md/glossary/mrr)
- **Previous:** [SaaS metrics and unit economics](https://lopifi.com/md/learn/saas-metrics-and-unit-economics)
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